Temporary power specialist Aggreko has reported an eight per cent dip in annual pre-tax profits, bringing to an end a near decade-long growth period for the Glasgow-based company.

Chairman Ken Hanna said 2013 results are “credible” in what was a “difficult year” for Aggreko, which earlier this week announced chief executive Rupert Soames is stepping down in April to join outsourcing giant, Serco.

Reported revenues were flat at £1.57 billion though trading profits were down eight per cent to £352 million (2012: £381 million) and pre-tax profits were also down eight per cent to £333 million (2012: £360 million).

Group trading margins were down two per cent on the previous year to 22 per cent.

On an underlying basis, Aggreko said revenues and trading profits were up four per cent and one per cent respectively.

The group has announced it is returning £200 million of cash to shareholders as well as hiking its dividend 10 per cent, with a final dividend of 17.19p taking the total annual dividend to 26.30p.

This special dividend comes largely at the expense of Aggreko having halves capital expenditure on new fleet for its Power Projects division, which allowed the group to cut net debt by £230 million on the previous year to £363 million.

Aggreko said although the net debt position at the year-end was £363 million, including the £200 million special dividend to shareholders, adjusted net debt at the year end is £563 million.

The group said a “number of factors” contributed to the weaker 2013 figures, which Aggreko said as viewed against what was an “exceptionally strong” 2012.

Contributing factors bolstering 2012 results had included the London Olympics and peak revenues from Military work in Afghanistan and post-Fukushima Japan reconstruction.

Aggreko said “weakening exchange rates” had also hit 2013 full-year results to the tune of £10 million in revenues terms and by £6 million in trading profit.

The group said the performance of its Power Projects business has been “more challenging”, with revenues flat for the year and margins “a little lower”.

In its Local business, Aggreko said revenue growth on an underlying basis – before costs – rose seven per cent and the division's start to the 2014 year has been “encouraging”, with volumes on rent currently up seven per cent on the prior year.

In Power Projects, Aggreko said a 120MW plant agreement in Libya has yet to be taken on the order book, “given the volatile situation in the country”, and Aggreko said it will not include the contract until it is certain it will be able to execute it.

Including the Libya contract, Aggreko said current order intake for the first quarter is at a “similar level to the final quarter of 2013”.

As a result of subdued trading conditions in our Power Projects, Aggreko said it cut fleet expenditure to £205 million compared with £415 million spent on fleet in 2012.

Looking ahead, Aggreko said the start of 2014 has been “encouraging”, the group notes “the latest spot rates for some of our major trading currencies have moved against the average exchange rates of 2013; if these rates pertain for the rest of the year, we would see a marked translational impact on our 2014 reported results”.

Commenting on the results, chairman Ken Hanna said: "After nine consecutive years of growth, 2013 proved to be a challenging year; despite this Aggreko delivered a creditable performance and good progress on many fronts.

“Our Local business delivered underlying revenue growth of seven per cent and margins strengthened; trading in our Power Projects business was, however, more challenging, with underlying revenue at similar levels to last year and margins a little lower.

“As a result of a disciplined approach to capital expenditure, we generated strong cashflow and net debt reduced by £230 million; I am therefore delighted that we can announce a £200 million return of cash to shareholders as well as a 10 per cent increase in the dividend."